Medicare Plan Part B (Medical Insurance)

Medicare Plan Part B is medical insurance that helps pay for your medically necessary services and supplies. A majority of Americans will have to pay a premium to receive this Medicare Part B coverage.

Medicare Part B covers outpatient care, your visits to the doctor, physical or occupational therapists, and additional home health care. While many of your medical services and products are covered, Medicare Part B is still not a 100% insurance coverage plan. So, as with any other insurance policy, you should understand the plan and coverage completely upon enrolling.

Medicare Part B will provide you with additional medical insurance coverage that can help minimize your medical concerns. Remember that for no matter which health care insurance coverage you choose, you need to have a clear understanding of your options, coverage, and the premiums.

If you have any questions, you should seek a Medicare representative that will take time to explain what type of coverage you will receive and will offer clear instructions for signing on with Medicare.

What Does Medicare Part B Pay For?

Medicare Part B will help pay for you doctors' services, your outpatient hospital care, and some of your other medical services that Part A doesn't cover. This can include the services of physical and occupational therapists, and some of your home health care. Medicare Part B can help pay for these Medicare approved services and supplies when they are medically necessary.

One thing that you should be aware of is that with Medicare Part B coverage the difference between the actual cost of medical items or services, particularly physicians' services, and the "reasonable charge" approved by Medicare.

When an item or service is determined to be coverable under Medicare, it is reimbursed at 80% of the "reasonable charge" for that item or service, the patient is responsible for the remaining 20%.

Unfortunately, the "reasonable charge," a rate set by Medicare, is often substantially less than the actual charge. The result of the "reasonable charge" reimbursement system is that Medicare payment, even for items and services covered by Part B, is often inadequate. That means that you are often left with additional out-of-pocket expenses.

What Is The Cost For Medicare Part B?

The premium that you pay for Medicare Part B coverage is determined by Medicare. The monthly premium amount is available in the "Medicare & You" handbook produced by the U.S. Centers for Medicare and Medicaid (CMS).

Before 2006, the U.S. Government generally funded about 75 percent of the total Medicare Part B premium. Starting in 2007, higher income beneficiaries began to receive a reduced subsidy which was fully phased in by 2009.

At that time, subsidies for higher income beneficiaries will range from about 65 percent to 20 percent of the total premium. This change will affect only about four percent of all Medicare beneficiaries. The Medicare Part B premium for 2009 ranged from $96.40 to $308.30, but will be adjusted annually.

A majority of people pay their Medicare Part B premium every month.  The amount of  the premium can change every so often. In some cases this amount may be higher if you didn't choose Part B when you first became eligible at age 65.

The cost of Part B may go up 10% for each 12-month period that you could have had Part B but did not sign up for it, except in special cases. You probably will have to pay this extra 10% as long as you have Medicare Part B.

In addition, your Medicare Part B premium may be higher if your income is above a certain level as outlined above. Enrolling in Medicare Part B is your personal choice. You can sign up for Medicare Part B anytime during a 7-month period that begins 3 months before you turn 65. 

If you decide to receive Medicare Part B, the premium is usually taken out of your monthly Social Security, Railroad Retirement, or Civil Service Retirement payment. If you don't get any of the Railroad or Civil Service Retirement payments, Medicare sends you a bill for your Part B premium every 3 months. You should get your Medicare premium bill by the 10th of each month.